* Potential windfall tax concerns hurt Banks
* Miners, oil stocks weaker as dollar rises
* Travel firms stronger; broker bullish
By David Brett
LONDON, Dec 7 (Reuters) - Britain's top share index fell 0.5
percent on Monday, as concerns over a potential windfall tax
dragged banks lower, while miners and energy stocks dropped with
commodities prices as the U.S. dollar strengthened.
At 1155 GMT, the FTSE 100 <> was down 25.36 points at
5,297.00, having closed up 9.36 points on Friday at 5,322.36.
"Trading has been fairly lacklustre," said Joshua Raymond,
Market Strategist at City Index.
"However, equities have already moved to recover somewhat
from earlier sharper losses and this encourages that today's
consolidation may be limited," Raymond added.
Banks led the fallers on news that Britain was still
considering some kind of windfall tax on banks.
Barclays <BARC.L>, HSBC <HSBA.L>, Lloyds Banking Group
<LLOY.L>, Royal Bank of Scotland <RBS.L> and Standard Chartered
<STAN.L> fell 0.1 to 3.3 percent.
A government source told Reuters on Friday that a tax on
banks was one revenue-raising option being considered by finance
minister Alistair Darling for his pre-budget report on
Wednesday, and weekend newspapers were heavy with speculation on
what form this could take. []
Capital will remain tight for European banks in the next two
years as regulatory changes bite, which will effectively
"scuttle" many banks' ability to lend, analysts at Evolution
Securities said in a 2010 preview note.
Miners were on the back foot as investors switched out of
commodities and back into the U.S. dollar, which hit a five-week
high against a currency basket on Monday. []
Better than expected U.S. job numbers on Friday fuelled
speculation the Federal Reserve may consider winding down its
stimulus measures which boosted the dollar.
Eurasian Natural Resources <ENRC.L>, Fresnillo <FRES.L>,
Vedanta Resources <VED.L>, Rio Tinto <RIO.L>, BHP Billiton
<BLT.L> and Xstrata <XTA.L> lost 0.7 to 3 percent.
BHP Billiton and Rio Tinto signed a $116 billion iron ore
joint venture agreement on Saturday to combine their Western
Australian iron ore operations. []
Energy stocks were hurt by a 1 percent drop in the price of
crude <CLc1>, with Cairn Energy <CNE.L>, BG Group <BG.L> and
Tullow Oil <TLW.L> down 0.9 to 1.1 percent.
Defensive pharmaceutical and telecoms stocks fell back after
posting gains on Friday, with AstraZeneca <AZN.L> and
GlaxoSmithKline <GSK.L> off 0.5 and 0.6 percent respectively,
while Vodafone <VOD.L> lost 1.2 percent.
Scottish & Southern Energy <SSE.L> shed 0.2 percent after UK
energy regulator Ofgem set new price controls.
Britain's six big energy suppliers must cut their power and
gas prices early next year and should not use their need to
invest as an excuse to overcharge customers, energy regulator
Ofgem said. []
TRAVEL FIRMS
Among the gainers Tui Travel <TUI.L> added 2.5 percent after
Panmure Gordon repeated its "buy" rating following results last
week from Europe's biggest tour operator.
Thomas Cook <TCG.L> also climbed 2 percent. Panmure repeated
its "buy" rating on the company and raised its target price to
315 pence from 310 pence on Friday.
British accountancy software company Sage <SGE.L> gained 2
percent as BofA Merril Lynch raised its target price to 250
pence from 237 pence following the company's results last
Wednesday.
On the middle tier, waste management firm Shanks Group
<SKS.L> soared 40 percent after the company revealed a 536
million pound buyout approach, but said its board and key
shareholders were looking for at least 10 percent more.
In the U.S., October consumer credit numbers and November's
Employment index are due for release later.
(Editing by Jon Loades-Carter)
